The 2021 alt season

by Deep Trade

In addition to bitcoin, there are many crypto coins that are getting more and more popular among users every day. Altcoins are constantly improving and new digital currencies with unique benefits keep coming to the market. All this leads to market development and cryptocurrency technologies becoming widespread.

What is an altseason?

Altseason in most cases means the simultaneous occurrence of two conditions:

  1. Slowing down the growth or a correction of the  Bitcoin.
  2. After the BTC dominance index peaks, it starts to decline.

At this point, altcoins catch up to or overtake Bitcoin's growth rate. A stable and gradual change is replaced by a rapid increase in their price. This is the period when entire groups of tokens start to rapidly increase in price, which is called altcoin season.

This is not because Bitcoin is losing its investment appeal. It's just that investors are recognizing and investing in the significant growth potential of alternative crypto assets. Accordingly, liquidity is flowing from Bitcoin to other assets.

Coins that gained value in early 2021

Various analysts predicted the transition of liquidity from Bitcoin to altcoins in 2021. Back in January, several coins saw rapid growth. Some of them rose in price by 100% or more in a week.

LRC (Loopring)

The website CoinMarketCap is a popular source of information for cryptocurrencies. According to this source, the LRC altcoin was far from its peak in early 2021.

In January, the price of this coin increased by 145% in 24 hours. Analysts consider the value promising as it is a prominent player in the DeFi segment. Decentralized finance continues to gain popularity, and so does everything related to it.

LRC continues to gain ground in November really fast.

After October 28, the value of this altcoin increased dramatically. From $0.37, it reached the $1.19 mark.

LRC's growth could continue until the end of 2021, as Loopring's Layer2 protocol is an effective scaling tool for Ethereum.

Ethereum is the second most popular blockchain after Bitcoin. Every day, new applications are launched on the platform and a large number of transactions are performed. All this causes a decrease in the speed of the network and an increase in commissions.

In order for the Ethereum blockchain to be used more widely and efficiently, its main issues need to be addressed. Various projects are trying to achieve this goal. Loopring is one of them. This scaling protocol allows the creation of decentralized cryptocurrency exchanges and offers an alternative to centrally managed platforms.

As a result, users have the ability to trade digital assets without intermediaries - brokers, agents, custodians, etc.

To aggregate a large number of transactions outside of the Ethereum network, Loopring uses a tier 2 scaling solution called "zkRollups".

That provides:

Complete confidentiality;

Element of decentralization;

Fast processing of Ethereum transactions;

Low commissions.

These are benefits and core values for cryptocurrency users. Therefore, there is every reason to expect a further increase in the value of the LRC token.

Dogecoin (DOGE)

This altcoin has a strong community that actively supports it. In early 2021, DOGE grew 110% in one week. This was followed by sharp increases in value in mid-April and early May in the bullish direction.

This trend was observed against the backdrop of comments by Elon Musk, who spoke positively about the Dogecoin project. The billionaire's constant attention to this asset, which was initially perceived ironically, eventually led to it being placed in the low-risk instrument category. Of course, you have to keep in mind that any cryptocurrency has increased risk compared to traditional assets.

DOGE is now well above the price level it reached in the first week of January 2021. At that time, the altcoin stood at $0.088, and now its price is $0.26. The high for this year is $0.68.

Celo (CELO)

This altcoin surged 85.6% in the first week of 2021, reaching $2.7 per coin. Even with corrections, there was significant growth. In May, the token reached a new high of $6.33 per coin.

After a decline that lasted until August, the price reached the level of $7.24, and in September it rose to $7.68. CELO now costs $6.32 per coin. Over the year, the price has increased by 307%.

This altcoin has growth potential as it implements solutions in directions that are popular with users:

An open platform with support for a wide range of decentralized applications;

The development and subsequent use of smart contracts;

Network operations based on a protocol with proof of ownership: the ability to mine without expensive equipment.

The more popular the platform becomes, the more the value of the CELO token increases.

Uniswap (UNI)

A well-known project in the DeFi segment launched in September 2020. The decentralized exchange Uniswap is considered one of the most popular platforms based on Ethereum today. The service offers a token exchange for sellers and buyers, which creates liquidity.

In the first week of January, it gained 54.9% to reach $5.68. After that, the value increased rapidly, selling for $42.77 on April 29. Now the price of UNI is $25.7.

Ethereum (ETH)

In the first week of January 2021, the Ethereum token gained 47.02%. Its price was $1049.6.

As it progressed, the value steadily increased. In May, the price jumped and ETH reached 4182.7 USD. In November, Ether outperformed the highest price point of spring levels and reached the value of 4607.7 USD per coin. According to various analysts, the alt season is not over yet, so it is still time to invest in Ethereum.

The platform itself is attracting more and more attention, partly because it is successfully scaling by creating new ecosystems and networks.

Polkadot (DOT)

This is an ecosystem that allows synchronized collaboration with different platforms. It has tools to create, test, and launch new blockchains.

In the first week of January, the value of DOT increased by 46.9%, reaching $9.53 per token. The upward trend continued, and in May, this altcoin sold for $47.33. Members of my Telegram channel acquired it during this period.

In November, the ATH was updated - the price of DOT was $52 per coin.

Cross-blockchain tools are a tangible step towards scaling the crypto industry, so the popularity of the Polkadot platform will grow, as will the value of the DOT token.

It is worth paying attention to the project associated with this decentralized ecosystem, the Kusama network. Over the course of the year, the value of the KSM token has increased by 1405%.

Synthetix Network Token (SNX).

This is a decentralized financial protocol based on Ethereum. It allows you to create synthetic assets as tokens.

In the first week of January, SNX gained 52.8% to reach $12.1 per coin. In February, the asset also saw rapid growth, peaking at $26.42.

Now, the SNX price has fallen to $10.5 per coin. You need to buy this token wisely as the Synthetix project has many strong competitors.

Should we expect a market correction?

In 2021, many tokens moved down quickly and hit new maximums. In August, the dominance of altcoins in the crypto market increased by 11% and reached 53%.

Analysts from the American financial holding JPMorgan pointed out that the share of tokens in the cryptocurrency market was 57.7% in the fall. In May 2021, after this figure was reached, the crypto market dropped in value. This information indicates that there is a possibility of a fall in the price of digital assets.

According to the experts at RBC-Crypto, the fall season of the market of cryptocurrencies is not overheated. Many altcoins are now below the highs reached during the year. In May, for example, the capitalization of the cryptocurrency market was $2.6 trillion. In September, that number dropped to $2.36 trillion.

Analysts believe that the current market situation points to the possibility of a new wave of altseasons rather than an imminent price decline. In general, the growth of the price of tokens in the crypto market is likely to continue at least until the end of this year.

Investors are looking for tokens of popular blockchains and projects to ensure their effective scaling. But when BTC starts to reach the highs again, the majority of crypto traders will put the profit from altcoins into the main coin of the market: Bitcoin. This process is cyclical. The growth of altcoins is periodically replaced by an upward movement of BTC. If you take these "fluctuations" into account, you can adjust to the cycles of the crypto market.

The market capitalization of altcoins continues to grow.

The indicators of tokens of projects working in the DeFi segment are also going up. The market capitalization of this sector reached $164 billion, updating the high set for this year. In May, the capitalization of DeFi was at the level of $139 billion. Now, this level has been successfully conquered.

Nikita Soshnikov, the CEO of the Alfacash service, notes that the alt season will not last forever. But, in his opinion, a strong correction of the crypto market will happen if two factors coincide:

  • altcoins exhaust the resources of bullish movement;
  • bitcoin does not renew its ATH(All-Time High).

In this case, investors will begin to transfer their crypto assets into stablecoins: USDT, PAX, DAI, etc. If such a capital movement occurs, there will be a risk of correction of the BTC price (and other digital assets).

In 2021, investors are most interested in the decentralized finance (DeFi) sector and non-fungible tokens (NFT). You can bet on the capitalization of such assets due to the growing popularity of these segments among the community.

What can you invest in November 2021?

There are still coins dependent on the BTC exchange rate but have not yet caught up with its price. This fact increases the likelihood of growth in the capitalization of altcoins in the coming months.

One of the tokens that have not exhausted its growth potential this year is Binance Coin (BNB).

Over the past 12 months, this asset has grown by 1959%. The growth in 30 days was 29.4%. BNB has set a high of $675.10 per coin this year. Now the price of the Binance exchange token is hovering around $600, the asset remains bullish.

Until the end of the altseason, you can get a good profit on this coin. Binance is one of the world's leading blockchain ecosystems. It will remain in demand for a long time for several reasons:

  • creation of infrastructure for the crypto segment;
  • availability of successful solutions in the field of NFT;
  • providing access to a set of well-designed decentralized financial products.

Coins such as Ripple (+ 395.1% y / y) and Cardano (+ 2022.6% y / y) may rise in price during November. These projects are some of the most popular ones when it comes to altcoins, but they react to the general impulses of the crypto market with a delay.

It is worth paying attention to Chainlink (LINK). In July, this altcoin turned around the support level and continues to grow ever since. In the latest cryptocurrency bounce, LINK remains undervalued and retains tangible upside potential.

Chainlink is one of the most popular decentralized networks of oracles  ( tools for smart contracts). Many applications running on second-tier chains use the services of this project to launch and protect their smart contracts.

Another promising project is the FTX cryptocurrency derivatives exchange. Not so long ago, it attracted new investments. Its development is accompanied by positive news.

The token of the FTX (FTT) cryptocurrency exchange increased in price by 1603.9% over the year. The recommendation for its purchase was published in my telegram channel. The altcoin is currently in a correction relative to the highest price reached in September. Given the recent fundraising, this asset may show good growth at least until the end of the year.

The price of the Solana (SOL) project may go up. This distributed blockchain protocol is called “the Ethereum killer”. It also supports the creation and operation of smart contracts, but at the same time provides a noticeably faster transaction processing speed.

Solana can process over 50 thousand transactions per second with a commission noticeably lower than in Ethereum - $0.0007. The advantages of this blockchain allow it to quickly take market share from other platforms using smart contracts.

The rapid growth of the SOL altcoin began in August. And over the year, the cost of the token has grown by 16952%.

According to analysts, this is far from its potential, and SOL will remain bullish in the coming months. The current price of the Solana blockchain altcoin is $240. Many traders are confident that it will reach the $307 level.

Of course, the list of promising altcoins would not be complete without Polkadot and Kusama. The tokens of these projects have already shown significant growth this year. And thanks to the work of parachains, this trend can continue with renewed vigor. In addition, it is worth paying attention to those projects that will link to these ecosystems as parachains. They are also able to provide good profit for their investors.

In general, the altseason may continue well into the next few months. But in any case, you need to keep in mind that cryptocurrency is a very risky market that can crash at any moment. And given the growth that it has already shown this year, we can conclude that the value of many assets is now greatly overestimated. Therefore, investing money even in the most promising projects, you always need to correctly analyze the current situation and be ready at any time to change your position.

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